Q: How significant is a business’s name? Should a business’s name reflect what the business does, or should it be something catchy and easy to remember?
Randy P. –
A: What is the significance of a name? When it comes to your business, Randy, there is a lot more to consider than you might believe. Indeed, choosing a business name is one of the most critical choices you will make. While the right business name can help you stand out from the crowd, the wrong one can leave you trampled in the rush.
With the economy in a slump and competition increasing, it is more critical than ever to devote significant thought to creating the ideal name for your business.
Regrettably, this is a much easier said than done task. It appears as though every good business name is either married or… No, that is not the case; however, the analogy holds true.
We live in an age when a business called “The Body Shop” could repair wrecked cars or sell skintight jeans to teenagers, so before you send your letterhead to the printer, consider the following points to assist you in selecting the best business name for you.
The first step should be to conduct some research to determine whether the name is already in use by another party. You would be surprised how many entrepreneurs overlook this point and open a business with an already-used name. Consult the county clerk and the secretary of state to ensure that the name is not already in use or incorporated with the state. Additionally, check with the United States Patent and Trademark Office to determine whether the name is already trademarked, i.e., owned, by another party. Utilizing a trademarked name of another business exposes you to legal action from the trademark owner. Even if your name is only a close match to a trademarked name, you may find yourself defending your right to use the name in court. And the likelihood is that you will lose the battle.
If the name you select is not already in use, you should immediately reserve it with the secretary of state (if you intend to incorporate) and file for a trademark to establish your legal ownership. If you do not trademark the name, someone else may attempt to steal it from you later. Consider investing years in growing your business only to have an upstart trademark the name and drag you into a legal battle over proper ownership. This is one battle you do not need, particularly when the hassle could have been avoided with a few dollars and a few forms.
Another critical factor to consider is your business’s domain name. The domain name is the web address that a customer will use to locate your website on the Internet. Is your business’s domain name available? If not, is there a domain name that is a close match for the business name you are considering?
You will undoubtedly discover that obtaining an appropriate domain name is more difficult than selecting a business name. Although the majority of logical domain names are already taken, you might get lucky. Bear in mind that domain names should be concise and descriptive, preferably ending in.com or.net. You may use alternate extensions (I have even used the “.to” extension on occasion), but keep in mind that you will need to make an additional marketing effort to promote the website address, as most people assume a.com extension is the standard. Whatever you do, avoid choosing a domain name that is a jumble of letters and numbers that is difficult to remember and even more difficult for your customer to type.
One effective strategy for approaching the task of business naming is to do so from the perspective of your customer. Your business name should succinctly describe your product or service and effectively communicate your message to customers. For a moment, put yourself in your customer’s shoes. What would you expect a business that provides your product or service to be called if you were looking for one? If you were looking for computer parts, for example, would not you look for a business whose name includes the phrase “computer parts”? Jim’s Computer Parts may not have the same snazzy ring as Jim’s Electronics Emporium, but snazzy does not pay the rent. Doing so are satisfied customers who quickly identify you as the source of their purchase.
Additionally, the name of your business can elicit subconscious reactions in a customer, either attracting or repelling them. The terms “quality,” “complete,” “executive,” “best,” “low-cost,” and “on time” frequently elicit positive responses in the consumer’s mind. The terms “cheap,” “discount,” and “used” elicit negative emotions. You will notice that while no one claims to sell used cars anymore, dealer lots are brimming with “previously owned” vehicles.
Finally, let us discuss what to avoid. Experts agree that you should avoid using generic terms in your everyday business name, such as enterprise, corporation, partners, and unlimited. While these terms are acceptable for the legal business entity’s name, they are frequently too ambiguous for everyday use. Could you please tell me what ABC Corporation, Big Dog Enterprises, M&B Partners, and Discounts Unlimited sell? I did not believe that.
Additionally, avoid using abstract terms such as Yahoo, Google, Monster, and Flip Dog. (I will refrain from listing the numerous local high-tech firms that have defied this rule:o). Abstract names will require a subtitle explaining what the business does or an expensive marketing campaign to cement the name in consumers’ minds. Unless you have deep pockets, I recommend that you choose a name that accurately describes your business and leave abstraction to the likes of Cher.
Finally, you should avoid ridiculous names, unless you are starting a ridiculous business. Crazy Dave’s Stereo Shop is an excellent name if the business is truly run by Crazy Dave and his personality is leveraged in the business’s marketing.
However, if you want your business to be taken seriously, you should give it a serious name.